London/New Delhi, Feb 18 (Inditop.com) Tatas could become the first Indian industrial group to face a major strike in Britain after union leaders hinted at “strategic action” by workers to thwart a decision by Tata Steel-owned Corus to mothball a plant in northeast England.
Corus, the European arm of Tata Steel, is due to mothball its Teesside Cast Products plant in Redcar Friday, with 1,600 redundancies and, regional authorities believe, job losses for up to 8,000 workers in the local supply chain.
Terry Pye, who heads the steel section in Britain’s largest workers’ union Unite, raised the possibility of industrial action, saying: “We will be calling on our members at the other Corus sites to take strategic action to force the company to take heed to the offers it is receiving to save the plant.”
With the strike threat coming just months ahead of British general elections due by early June, the Corus move has prompted a dash to Teesside – a region with 150 years of steelmaking history – by Britain’s number two in the cabinet, Lord Peter Mandelson.
Alongside, Mandelson’s junior minister in the department of business, skills and innovation Pat McFadden met Tata executives on the sidelines of a meeting of the Confederation of Indian Industries (CII) in New Delhi Tuesday, informed sources told Inditop.
Corus says it was forced to take the decision after an international consortium of four companies “illegally” reneged on an agreement last April to buy 78 percent of the steel slabs produced at the plant for 10 years.
But Unite and the local mayor have written to government ministers and Corus executives saying there is at least one credible potential buyer.
Pye told The Times of London: “Unite believe the mothballing of Corus’s Teesside site is a disgraceful charade. The union has reason to suspect that Corus never had any intention of selling this plant and they intend to close the site, which will have a devastating effect on the community.”
An additional problem arises from the fact that the British government faces restrictions over what it can offer to potential bidders – incentives such as wage subsidies – because of European Union rules on state aid.
Corus said: “We cannot comment on specific merger and acquisition issues. We have always maintained that there is a possibility that steelmaking could resume if a buyer were found.”
Minister Pat McFadden told British MPs in December last year that despite the failure of Corus and the consortium to resurrect their agreement, Corus has “tried to keep the plant alive”.
